South Gate : Pete Ellis Granted Funds for New Car Dealership

The City Council, acting as the Redevelopment Agency, has entered into an agreement with automobile dealer Pete Ellis to develop an auto sales dealership in South Gate that officials said could produce more than $1 million in sales taxes in five years.

Officials have agreed to help Ellis develop property at 5910 Firestone Blvd., which is the site of a former dealership. The site has been vacant since South Gate Hyundai moved in December.

Under the agreement, Ellis will be given a $350,000 grant and a $250,000 loan to improve the 2.7-acre property. Ellis will repay the loan at 12% interest.

Ellis will purchase an automobile dealership in another city and relocate it at the Firestone Boulevard site. As part of the agreement, the name of the dealership could not be revealed until escrow closes in about 45 days, officials said.

The council approved the agreement by a 5-0 vote. Last month, Ellis pulled out of a project to develop an auto sales lot next to a 20-acre mobile home park. Residents of the park and their supporters conducted a successful petition drive to place the issue on the ballot in June.

Voters will be asked whether they approve developing the property for any type of auto sales. The referendum is only an advisory measure.

Ellis owns the Pete Ellis Dodge and Jeep/Eagle dealerships in South Gate.